Key Takeaways
- Japan has committed to significantly increase its defense spending with U.S. firms to $17 billion annually, up from $14 billion, alongside major purchases of 100 Boeing airplanes and an 75% increase in rice imports.
- Freeport-McMoRan (FCX) and Amphenol (APH) reported stronger-than-expected Q2 2025 earnings, with Freeport-McMoRan noting potential 5% cost increases due to tariffs.
- An internal probe by the World Economic Forum (WEF) has found founder Klaus Schwab engaged in a pattern of workplace misconduct and unauthorized spending over the past decade.
- Canada's new housing prices continued their decline in June, falling 0.2% month-over-month and 1.0% year-over-year, marking a seventh consecutive monthly drop in the national composite MLS Home Price Index.
Global markets are reacting to a flurry of significant economic, corporate, and geopolitical developments. A major trade agreement between the United States and Japan is poised to reshape economic ties, while leading companies announce robust earnings. Meanwhile, a high-profile investigation at the World Economic Forum has revealed concerning findings, and key economic indicators from Canada signal ongoing housing market adjustments.
US-Japan Strengthen Economic and Defense Ties
The White House has announced a landmark agreement with Japan, set to significantly boost economic and defense cooperation. Japan will increase its annual defense spending with U.S. firms to $17 billion from $14 billion. This expanded commitment includes the purchase of 100 Boeing airplanes and a 75% increase in rice imports, alongside plans to spend an additional $8 billion on agricultural and other goods from the U.S. The deal also includes a reduced 15% tariff on Japanese auto and auto parts exports to the U.S., down from a previously threatened 25%. A German government spokesperson noted that this Japan-U.S. tariff agreement is "not comparable" with the current EU-U.S. situation.
Corporate Earnings Outperform Expectations
Amphenol (APH) reported strong Q2 2025 earnings, with net sales reaching $5.65 billion, surpassing estimates of $5.04 billion. Adjusted earnings per share (EPS) for the quarter came in at 81 cents, significantly higher than the estimated 67 cents. The company also provided an optimistic Q3 sales outlook of $5.48 billion to $5.58 billion, exceeding the estimated $5.24 billion.
Freeport-McMoRan (FCX) also posted robust Q2 2025 results, with revenue of $7.58 billion against an estimated $7.18 billion. The company's adjusted EPS was 54 cents, outperforming the estimated 45 cents. Copper production, however, saw a 7.1% year-over-year decrease to 963 million pounds. Freeport-McMoRan estimates that tariffs could potentially increase the costs of goods it purchases in the U.S. by approximately 5%.
World Economic Forum Founder Under Scrutiny
An internal investigation by the World Economic Forum (WEF) has uncovered a pattern of workplace misconduct and unauthorized spending by its founder, Klaus Schwab, spanning the last decade. The probe's findings indicate inappropriate behavior and financial irregularities. Schwab had reportedly stepped down from his role as chairman following whistleblower allegations.
Apple Introduces New Unified Protection Plan
Apple (AAPL) has introduced AppleCare One, a new streamlined coverage plan. This new offering aims to simplify device protection, allowing coverage for up to three devices for a monthly fee of $20. The plan includes unlimited repairs for accidental damage, 24/7 priority support, and battery service, and expands theft and loss protection beyond iPhones to include iPads and Apple Watches.
Economic Data and Geopolitical Updates
Canada's new housing prices continued their downward trend in June, with a 0.2% decrease from May and a 1.0% decline year-over-year. This marks the seventh consecutive monthly drop in the national composite MLS Home Price Index.
In other news, a U.S. Treasury Secretary stated that Amazon (AMZN) CEO Andy Jassy indicated last week that he sees "no price hikes" for consumers. However, a recent analysis suggests Amazon has quietly raised prices on some low-cost goods by an average of 5% since April, despite the company's denials.
Geopolitically, Iran has claimed it "intercepted a U.S. destroyer" in the Gulf of Oman, with state-run IRIB reporting the U.S. vessel backed down and withdrew. Separately, Iran seized a foreign tanker in the Gulf of Oman on suspicion of fuel smuggling.
Finally, Brazil's National Agency of Petroleum, Natural Gas and Biofuels has approved an agreement to jointly develop the JUBARTE pre-salt oil field with Petrobras. This agreement facilitates shared production rights and operations in the field. The European Union is also set to impose price floors on global ferroalloy imports amid a surge fueled by China.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.